Louisiana Legislature gets reckless on revenue cutting: An editorial

A couple of weeks ago, Rep. Hunter Greene understood that tax cuts have an impact on the state's budget, which must be considered.

File photoRep. Hunger Greene, R-Baton Rouge

He had urged members of the House Ways and Means Committee, which he chairs, to carefully consider the effects of targeted tax breaks before passing them on to the House.

Unfortunately, that prudent approach was absent Monday when the committee adopted bills authored by Rep. Greene that would have a far more profound effect. House Bill 634 would repeal the personal income tax and House Bill 633 eliminates the corporate income tax in Louisiana.

Taken together, the bills would mean $14.8 billion in lost revenue over the first five years. HB 634 would eliminate $943 million in revenues in 2012, an amount that would grow to $3.5 billion by 2015-16, according to the Legislative Fiscal Office. HB 633 would reduce revenues by $81 million in the first year and would reach $303 million by 2015-16.

Similar legislation was passed out of the Senate Revenue and Fiscal Affairs Committee Monday. Senate Bill 259, authored by Sen. Rob Marionneaux, would phase both taxes out over five years.

Such a huge loss in revenue would devastate the state's general fund budget, either immediately or if the Senate approach were to prevail, over the next few years. But no one has come forward to suggest how how such a loss could be offset. "Maybe it will put some pressure on us to cut the budget or look at the things that we don't tax,'' Rep. Greene said.

How can the Legislature contemplate such a drastic move without any inkling of how the losses would be offset? Gov. Bobby Jindal, who has adamantly opposed any tax increases, has said that he would support more tax cuts, but only if lawmakers balance the budget with spending cuts.

That's the hard part, and legislators who ignore it are irresponsible. Ending the state income tax might be a popular move, but the state's general fund supports things that taxpayers understand are needed, like K-12 schools, higher education, public hospitals, Medicaid and state prisons.

This is reckless legislation, and sensible lawmakers as well as Gov. Jindal should work to kill it.